Which of the Following Is an Example of Base-Rate Information

question 8

Multiple Choice

Which of the following is an example of base-rate information?

• A) The population consists of 10,000 mosquitoes and 2 rare kwiny bugs
• B) The kwiny bug looks like a mosquito except it is a bit bigger
• C) The mosquito flies a bit faster than the kwiny bug
• D) A particular specimen looks exactly like a kwiny bug

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Definitions:

Utility Maximization

The process by which consumers allocate their income in a way that maximizes their overall satisfaction or utility.

Marginal-Utility Schedules

Tables or graphs showing the relationship between the quantity of a good consumed and the incremental satisfaction (utility) gained from consuming each additional unit.

Utility Maximization

An economic principle where consumers attempt to get the greatest satisfaction possible from their available resources.

Demand Schedule

A table of numbers showing the amounts of a good or service buyers are willing and able to purchase at various prices over a specified period of time.